2020 Market Update: Assessing the COVID Marketplace

2020 Market Update:Assessing the COVID Marketplace

SILVARMay 7, 2020.Leslie Appleton-YoungChief Economist + SVPCalifornia Association of REALTORS®

CALIFORNIA ASSOCIATION OF REALTORS®

SERIES: 2020 Coronavirus Member SurveySOURCE: CALIFORNIA ASSOCIATION OF REALTORS®

Mixed reactions on what worries members more

page3

35%

33%

32%

The U.S. will take too long inloosening restrictions

Unsure/Both

The U.S. will move too quickly inloosening restrictions

April 24-27

Q: Which of the following worries you more?

SERIES: 2020 Coronavirus Member SurveySOURCE: CALIFORNIA ASSOCIATION OF REALTORS®

¾ are at most moderately worried about Coronavirus

page4

Q: How worried are you that you or someone in your immediate family might catch the Coronavirus?

15%

29% 29%

17%

9%

1- Not at allworried

2- Slightlyworried

3- Moderatelyworried

4- Very worried 5- Extremelyworried

April 24-27Mean: 2.77


Overview: 8 Questions

page5

01 What is happening to the economy? 02 What is the government doing

to help?

03 Should I be worried about the mortgage market?

04 How is the CA housing market doing?


Overview: 8 Questions

page6

05 What about Silicon Valley? 06 How things in the trenches?

07 What will the post-COVID world look like? 08 What should I be doing now

to prepare?

SERIES: 2020 Membership SurveySOURCE: CALIFORNIA ASSOCIATION OF REALTORS®

#1 What is happening to the economy?


page8

2.3%

-4.8%-6%

-4%

-2%

0%

2%

4%

6%

2005 2008 2011 2014 2017 Q3-11 Q2-12 Q1-13 Q4-13 Q3-14 Q2-15 Q1-16 Q4-16 Q3-17 Q2-18 Q1-19 Q4-19

Ann

ual P

erce

nt C

hang

e,

Cha

in-t

ype

(200

9) $

A Sudden and Shattering Shock Longest Expansion in U.S. History is Over

page9

GDP - 2019: 2.3%; 2020 Q1: -4.8%ANNUALLY QUARTERLY

SERIES: GDPSOURCE: US Dept. of Commerce, Bureau of Economic Analysis

CA losing $31.5% of its Daily GDP

page10SOURCE: Wall Street Journal, Moody’s Analytics

page11

US jobless claims top 33 million since start of shutdowns

SOURCE: Dept. of Labor, New York Times, CNN

page12

Labor market impacts decelerating

SOURCE: FRED St. Louis Fed

0

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

7,000,000

8,000,000

2/29/2020 3/7/2020 3/14/2020 3/21/2020 3/28/2020 4/4/2020 4/11/2020 4/18/2020 4/25/2020 5/2/2020

U.S. Initial Unemployment Insurance Claims

12.3%18.6%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

16.0%

18.0%

20.0%

Jan-

06M

ay-0

6Se

p-06

Jan-

07M

ay-0

7Se

p-07

Jan-

08M

ay-0

8Se

p-08

Jan-

09M

ay-0

9Se

p-09

Jan-

10M

ay-1

0Se

p-10

Jan-

11M

ay-1

1Se

p-11

Jan-

12M

ay-1

2Se

p-12

Jan-

13M

ay-1

3Se

p-13

Jan-

14M

ay-1

4Se

p-14

Jan-

15M

ay-1

5Se

p-15

Jan-

16M

ay-1

6Se

p-16

Jan-

17M

ay-1

7Se

p-17

Jan-

18M

ay-1

8Se

p-18

Jan-

19M

ay-1

9Se

p-19

Jan-

20

California Unemployment Rate Estimates

page13

Well beyond Great Recession levels of unemployment

SOURCE: California’s Employment Development Department (EDD); and C.A.R. Estimates


Stock markets were poised for issuesThe stock market is NOT the economy

22.616.6

0

5

10

15

20

25

Q1-

71Q

1-72

Q1-

73Q

1-74

Q1-

75Q

1-76

Q1-

77Q

1-78

Q1-

79Q

1-80

Q1-

81Q

1-82

Q1-

83Q

1-84

Q1-

85Q

1-86

Q1-

87Q

1-88

Q1-

89Q

1-90

Q1-

91Q

1-92

Q1-

93Q

1-94

Q1-

95Q

1-96

Q1-

97Q

1-98

Q1-

99Q

1-00

Q1-

01Q

1-02

Q1-

03Q

1-04

Q1-

05Q

1-06

Q1-

07Q

1-08

Q1-

09Q

1-10

Q1-

11Q

1-12

Q1-

13Q

1-14

Q1-

15Q

1-16

Q1-

17Q

1-18

Q1-

19

U.S. Capital Markets P/E Ratio(Wilshire 5000 Market Cap / Total Corporate Profits)

+/-1 Std. Dev.

Stock market bounced back but still down from recent peak

page15

SERIES: Dow 30, NasdaqSOURCE: Yahoo! Finance

29,551

23,665

18,000

20,000

22,000

24,000

26,000

28,000

30,000

32,000Dow Jones (1/1/20 – 5/6/20)

9,817

8,854

6,000

6,500

7,000

7,500

8,000

8,500

9,000

9,500

10,000

10,500Nasdaq (1/1/20 – 5/6/20)

Financial markets impact people’s wealth & confidence

page16

SERIES: Dow 30, Nikkei, FTSESOURCE: Yahoo! Finance, Bloomberg

10,000

15,000

20,000

25,000

30,000

35,000

4/21

/201

5

6/21

/201

5

8/21

/201

5

10/2

1/20

15

12/2

1/20

15

2/21

/201

6

4/21

/201

6

6/21

/201

6

8/21

/201

6

10/2

1/20

16

12/2

1/20

16

2/21

/201

7

4/21

/201

7

6/21

/201

7

8/21

/201

7

10/2

1/20

17

12/2

1/20

17

2/21

/201

8

4/21

/201

8

6/21

/201

8

8/21

/201

8

10/2

1/20

18

12/2

1/20

18

2/21

/201

9

4/21

/201

9

6/21

/201

9

8/21

/201

9

10/2

1/20

19

12/2

1/20

19

2/21

/202

0

Dow Jones Industrial Average

Mar 2020:118.8

Apr 2020: 86.9

0

20

40

60

80

100

120

140

160

IND

EX, 1

00=1

985

April Consumer Confidence: Down 31.9 points Biggest decline since 1973

page17

Composite Index

SERIES: Consumer Confidence – Composite IndexSOURCE: The Conference Board

Coronavirus delivers record blow to US retail sales in March -8.7% MTM

page18

-8.7%-10%-8%-6%-4%-2%0%2%4%6%8%

Mar

-199

2M

ar-1

993

Mar

-199

4M

ar-1

995

Mar

-199

6M

ar-1

997

Mar

-199

8M

ar-1

999

Mar

-200

0M

ar-2

001

Mar

-200

2M

ar-2

003

Mar

-200

4M

ar-2

005

Mar

-200

6M

ar-2

007

Mar

-200

8M

ar-2

009

Mar

-201

0M

ar-2

011

Mar

-201

2M

ar-2

013

Mar

-201

4M

ar-2

015

Mar

-201

6M

ar-2

017

Mar

-201

8M

ar-2

019

Mar

-202

0

% C

hg. i

n Re

tail

and

Foo

d S

ervi

ces

MTM % Chg.

SERIES: Monthly sales of Retail and Food ServicesSOURCE: U.S. Census Bureau

Retail store sales by category

page19SOURCE: Mortgage Bankers Association


Consumers = 70% economic activity

0.1

2.3

-1.0

0.7

-0.3

-0.5

-0.9

-5.3

-4.8

-6 -5 -4 -3 -2 -1 0 1 2 3

Government

Imports

Exports

Res. Construction

Nonres. Construction

Inventories

Business Investment

Consumption

Real GDP

Contributions to % Change iN Real GDP


Other records we’re breaking

• Biggest drop in housing starts since 1984

• Largest decline in builder sentiment – ever

• Empire manufacturing index drops to lowest level – ever

• Industrial production at lowest level since 1946

• Philly Fed index at lowest level in 40 years

• Nearly 5 million households in forbearance

page022

page23

Restaurant bookings slide

SOURCE: OpenTable.com, J.P. Morgan

Seated restaurant diners tracked by OpenTable.comyty% chg.

page24

Hotel occupancy tumbles

SOURCE: Smith Travel, J.P. Morgan

U.S. hotel occupancy rate

*Greylines are data for 2018-2019

page25

Fewer commercial flights: U.S. airline passenger volumes -95%

SOURCE: Flightradar24 (March 27, 2020), BBC

Number of daily flights in March

page26

Grocery delivery surges but food delivery fails to increase

SOURCE: SimilarWeb.com, J.P. Morgan

Website traffic growth over 2018-2019 average

*Data through March 14


Forecasting the COVID-19 Economy“gussied up guesses”

Converging around -30 % for Q2

Q120 Q220 Q320 Q420 2020

Bank of America -7.0% -30.0% -1.00% 30.0% -10.4%

Congressional Budget Office -3.5% -39.6% 23.5% 10.5% -5.6%

Goldman Sachs -9.0% -34.0% 19.0% NA -6.2%

JP Morgan -10.0% -25.0% 8.0% 4.0% NA

Morgan Stanley -3.4% -37.9% 20.7% 15.9% -5.5%

UCLA 0.4% -30.0% -5.0% 4.0% NA

Wells Fargo -1.2% -22.3% 7.2% 4.8% -3.0%

page27

* Latest updates as of 04/27/2020


2. What is the government doing to

help?


page30

Fiscal Policy: Quick Action + Bottlenecks

SOURCE: California Association of REALTORS®

• Coronavirus Preparedness & Response Supplemental Appropriations Act (3/6)

• Families First Coronavirus Response Act (3/18)• Coronavirus Aid, Relief, and Economic Security Act

(CARES Act) (3/27)• Paycheck Protection Program & Health Care

Enhancement Act (4/24)

page31

Coronavirus Aid, Relief, and Economic Security Act (CARES Act)


• Forgivable Small Business Administration Loans - independent contractors who take out SBA loans between Feb. 15, 2020, and June 30, 2020 to cover payroll costs, mortgage interest, rents, and utility costs during the covered period may be forgiven.

• Pandemic Unemployment Assistance – REALTORS® not eligible for unemployment insurance will be able to obtain unemployment assistance for up to 39 weeks if they were negatively impacted as a result of COVID-19

• Direct Payments to REALTORS® – REALTORS® and their families with annual incomes of up to $75,000 will receive a rebate check of $1,200 ($2,400 for married couples with gross annual incomes up to $150,000). An additional $500 may be given per child in the household.

Small businesses running out of cash

page32SOURCE: J.P. Morgan Chase

Median small business holds 27 cash buffer days in reserve

page33

Monetary Policy: Federal Reserve has taken unprecedented action


• Cut fed funds rate down to 0% - 0.25%• Forward guidance: “rates will remain low” • Lowered discount window rate to 0.25%• Expanded repo operations • Open-ended Securities purchases (QE)- Treasuries, Gov’t

guaranteed MBS, commercial MBS • Direct lending to banks, major corporate employers• Temporary relaxation of regulatory requirements• Relaxed growth restrictions on Wells Fargo

-3-2-10123456

Jan-

05Ju

l-05

Jan-

06Ju

l-06

Jan-

07Ju

l-07

Jan-

08Ju

l-08

Jan-

09Ju

l-09

Jan-

10Ju

l-10

Jan-

11Ju

l-11

Jan-

12Ju

l-12

Jan-

13Ju

l-13

Jan-

14Ju

l-14

Jan-

15Ju

l-15

Jan-

16Ju

l-16

Jan-

17Ju

l-17

Jan-

18Ju

l-18

Jan-

19Ju

l-19

Jan-

20

Ann

ual %

Cha

nge

Inflation lowest since early 2019 – low oil prices

page34

SERIES: CPISOURCE: Bureau of Labor Statistics

CPI: March 2020 - All Items 1.5% YTY; Core 2.1% YTY

page35

Crude oil’s price plunged below $0

SOURCE: Bloomberg (as of April 20, 2020), BBC


3. Should I be worried about the mortgage

market?

Drop in applications as sales falterUptick in last 3 weeks

page37SOURCE: Mortgage Bankers Association Weekly Application Survey

Week-over-week % Chg. Year-over-Year %Chg.

Week ending 4/24/2020




CA 17.2% 2.9% -34.1% -47.9%

NY 13.7% -8.3% -49.9% -59.2%

WA 16.1% 12.3% -36.9% -45.8%

US 13.0% 3.0% -20.0% -31.0%Note: Not seasonally adjusted, home purchase applications only


Trending up: Applications coming off the bottom

7.2

0.0

-14.2

-10.3 -11.5

-0.9

3.2

12.7

-20

-15

-10

-5

0

5

10

15

20

3/6 3/13 3/20 3/27 4/3 4/10 4/17 4/24

Weekly Change in New Mortgage Purchase Applications

All Purchase Loans Conventional Government-40%

-30%

-20%

-10%

0%

10%

20%

3/6 3/13 3/20 3/27 4/3 4/10 4/17 4/24

Year-to-Year Change in New Mortgage Purchase Applications

Forbearance is not Forgiveness

page039

CARES act, allows impacted homeowners with federally backed loans to delay paying their mortgage and get a break on accumulating interest for up to 12 months.

Requests for mortgage forbearance skyrocketed by 1,270% between March 2 & March 16, and by another 1,896% between March 16 & March 30, according to the Mortgage Bankers Association.

What happens to suspended payments?Balloon at end of grace period?Extend term or repayment agreement?Loan modification?

https://www.cnn.com/2020/03/25/politics/stimulus-package-details-coronavirus/index.html

https://www.mba.org/2020-press-releases/april/mba-survey-shows-spike-in-loans-in-forbearance-servicer-call-volume

page40

Servicers face liquidity squeeze:Investors want payment; no appetite for risky loans


• Loan servicers: Investors to pay & shortage of short-term cash• Facing uncertain wave of forbearance & payment deferments• FHFA: Servicers only responsible for up to 4 months of missing

payments (P&I) on loans back by Fannie (4/21/20)• Servicers want Fed & Treasury to set up a liquidity facility• No appetite for risky loans

page41

Mortgage credit is tightening


• Fannie, Freddie & Ginnie Mae now requiring all income and asset documentation be dates within 60 days of initial application – not 120

• For the self-employed lenders must verify the existence of the borrower’s business within 10 days – not 120.

• J.P. Morgan Chase: new mortgage applicants will need a minimum FICO credit score of 700 and will have to make at least a 20% down payment on the home.

• Focus is on existing bank customers

7% of Mortgage Loans in Forbearance

page42SOURCE: Mortgage Bankers Association4/19/20


4. How is the CA market doing?

May Rising: Is it a good time to buy or sell?

45%

26%29%22%

28%31%

Do you think it’s a good time to sell a home in California?

Do you think it’s a good time to buy a home in California?

page44

SERIES: Google Consumer PollSOURCE: CALIFORNIA ASSOCIATION OF REALTORS®

March Sales: -11.5% MTMFirst YTY decline in 9 months

page45

California, March 2020 Sales: 373,070 Units, -11.5% MTM -6.1% YTY 3.1% YTD,

-

100,000

200,000

300,000

400,000

500,000

600,000

700,000

Jan-

05

Sep

-05

May

-06

Jan-

07

Sep

-07

May

-08

Jan-

09

Sep

-09

May

-10

Jan-

11

Sep

-11

May

-12

Jan-

13

Sep

-13

May

-14

Jan-

15

Sep

-15

May

-16

Jan-

17

Sep

-17

May

-18

Jan-

19

Sep

-19

SERIES: Sales of Existing Single Family HomesSOURCE: CALIFORNIA ASSOCIATION OF REALTORS®

Santa Clara County: -10.4% YTD

page46

SERIES: Sales of Existing Detached HomesSOURCE: CALIFORNIA ASSOCIATION OF REALTORS®

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

Jan-

05Se

p-0

5M

ay-

06Ja

n-07

Sep

-07

Ma

y-08

Jan-

09Se

p-0

9M

ay-

10Ja

n-11

Sep

-11

Ma

y-12

Jan-

13Se

p-1

3M

ay-

14Ja

n-15

Sep

-15

Ma

y-16

Jan-

17Se

p-1

7M

ay-

18Ja

n-19

Sep

-19

-25%

-20%

-15%

-10%

-5%

0%

5%

10%

15%

20%

25%Year-over-Year % Chg

March 2020 Sales: 636 Units, -10.4% YTD, -19.0% YTY

Median price +8.3% YTY - back above $600k

page47

California, March 2020: $612,440, 5.6% MTM, 8.3% YTY

$-

$100,000

$200,000

$300,000

$400,000

$500,000

$600,000

$700,000

Jan-

05

Sep

-05

May

-06

Jan-

07

Sep

-07

May

-08

Jan-

09

Sep

-09

May

-10

Jan-

11

Sep

-11

May

-12

Jan-

13

Sep

-13

May

-14

Jan-

15

Sep

-15

May

-16

Jan-

17

Sep

-17

May

-18

Jan-

19

Sep

-19

SERIES: Median Price of Existing Single Family HomesSOURCE: CALIFORNIA ASSOCIATION OF REALTORS®

Santa Clara County: Median price +7.7% YTY

page48

SERIES: Median Price of Existing Detached HomesSOURCE: CALIFORNIA ASSOCIATION OF REALTORS®

$0

$200,000

$400,000

$600,000

$800,000

$1,000,000

$1,200,000

$1,400,000

$1,600,000

-20%

-10%

0%

10%

20%

30%

40%Year-over-Year % Chg

March 2020: $1,400,000, Up 7.7% YTY

Unsold Inventory Index: New listings dropped in March tightening inventory

page49

0.02.04.06.08.0

10.012.014.016.018.0

Jan-

05

Sep

-05

May

-06

Jan-

07

Sep

-07

May

-08

Jan-

09

Sep

-09

May

-10

Jan-

11

Sep

-11

May

-12

Jan-

13

Sep

-13

May

-14

Jan-

15

Sep

-15

May

-16

Jan-

17

Sep

-17

May

-18

Jan-

19

Sep

-19

Mon

ths

of S

uppl

y

SERIES: Unsold Inventory Index of Existing Single Family HomesSOURCE: CALIFORNIA ASSOCIATION OF REALTORS®

Mar 2019: 3.6 Months; Mar 2020: 2.7 Months

Santa Clara County: Scant 2.0 months of inventory

Note: “Unsold Inventory Index” represents the number of months it would take to sell the remaining inventory for the month in question. The remaining inventory for the month is defined as the number of properties that were “Active”, “Pending”, and “Contingent” (when available) and divide the sum by the number of “Sold” properties for the month in question.

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

Jan-

12

Apr

-12

Jul-1

2

Oct

-12

Jan-

13

Apr

-13

Jul-1

3

Oct

-13

Jan-

14

Apr

-14

Jul-1

4

Oct

-14

Jan-

15

Apr

-15

Jul-1

5

Oct

-15

Jan-

16

Apr

-16

Jul-1

6

Oct

-16

Jan-

17

Apr

-17

Jul-1

7

Oct

-17

Jan-

18

Apr

-18

Jul-1

8

Oct

-18

Jan-

19

Apr

-19

Jul-1

9

Oct

-19

Jan-

20

page50

SERIES: Unsold Inventory Index of Existing Single Family HomesSOURCE: CALIFORNIA ASSOCIATION OF REALTORS®

March 2019: 2.3 Months; March 2020: 2.0 Months

What lies ahead? March pendings declined sharply with stay-at home orders

April & May Expected MTM Sales Drop: -25-30%

page51

-24.7%-30%-25%-20%-15%-10%

-5%0%5%

10%15%20%

YTY

% C

hg. i

n Pe

ndin

g Sa

les

SERIES: Percent Change in Pending SalesSOURCE: CALIFORNIA ASSOCIATION OF REALTORS®

Green Shoot: Showing Activity: YTY Gap Narrowing

page52

SERIES: Weekly showings Top 100 markets 7-day moving averageSOURCE: Showingtime.com,


#4 What about Silicon Valley?

Weekly Closed Sales % Chg last week CA: +.9%

Bay Area: -3.8SC County: -8.2%

SOURCE: CALIFORNIA ASSOCIATION OF REALTORS®

*Notes: Due to cut-off time, latest week includes 6 days only

Closed sales leveling off

page55

104

325

22

135

631

76

253

17110

486

Bay Area So CA Central Coast Central Valley California

Average Daily Closed SalesMar 1 - 7 Mar 8 - 14 Mar 15 - 21 Mar 22 - 28 Mar 29 - Apr 4Apr 5 - 11 Apr 12- 18 Apr 19 - 25 *Apr 26 - May 1

**Closed sales for the latest week will likely be revised upward due to recording delays.



California closed sales showed weekly gain for the 1st

time in 7 weeks

page56

9.7%5.4%

16.3%

4.8% 6.7%

-3.8%

10.1%

1.7%

-5.1%

0.9%


% Chg. in Closed Sales from Prior Week (Daily Average)

Mar 8 - 14 Mar 15 - 21 Mar 22 - 28 Mar 29 - Apr 4Apr 5 - 11 Apr 12- 18 Apr 19 - 25 *Apr 26 - May 1


SERIES: Median price of existing single-family homesSOURCE: CALIFORNIA ASSOCIATION OF REALTORS®

Closed sales by county (Bay Area)

page57

20

23

4

1

5

10

21

119

16 17

2 23

6

16

8

5

Alameda Contra Costa Marin Napa San Francisco San Mateo Santa Clara Solano Sonoma

Average Daily Closed Sales

Mar 1 - 7 Mar 8 - 14 Mar 15 - 21 Mar 22 - 28 Mar 29 - Apr 4 Apr 5 - 11 Apr 12 - 18 Apr 19 - 25 *Apr 26 - May 1



% chg. in closed sales from prior week (Bay Area)

page58

County/Week ending

Mar 14

Mar 21

Mar 28 Apr 4 Apr 11 Apr 18 Apr 25 May 1

Alameda 7.0% -14.4% -9.2% 4.2% 21.0% -4.7% -26.6% 8.9%

Contra Costa 6.9% -14.1% 6.8% 3.2% -7.5% -8.1% -12.4% -0.8%

Marin 42.3% -13.5% -37.5% 45.0% -13.8% -36.0% -25.0% 36.1%

Napa 30.0% 46.2% 10.5% -28.6% 20.0% -33.3% -25.0% 42.6%

San Francisco 24.3% -23.9% -5.7% -48.5% 41.2% -4.2% -13.0% 16.7%

San Mateo -14.7% 5.2% -6.6% 7.0% -19.7% -28.6% 42.9% -18.3%

Santa Clara 9.0% 0.6% -11.4% -8.6% -10.9% 23.7% -13.5% -8.2%

Solano 14.9% -3.5% -34.1% 24.1% 3.0% 2.9% -23.9% 3.7%

Sonoma 18.8% -17.1% -14.3% -7.4% -2.0% -10.2% 38.6% -38.8%


Pending Sales

Weekly Pending Sales % Chg last week CA: +5.9%

Bay Area: +4.1% SC County: +11.6%



Pending sales continued to rise…

page61

121

369

24

175

744

87

284

20

180

625


Average Daily Pending SalesMar 1 - 7 Mar 8 - 14 Mar 15 - 21 Mar 22 - 28 Mar 29 - Apr 4Apr 5 - 11 Apr 12- 18 Apr 19 - 25 Apr 26 - May 1



Pending sales growth slowed in latest week

page62

8.6%

-3.6%

4.7% 0.5%

-0.5%

4.1% 3.4%

-7.3%

8.0%

5.9%


% Chg. in Pending Sales from Prior Week (Daily Average)Mar 8 - 14 Mar 15 - 21 Mar 22 - 28 Mar 29 - Apr 4Apr 5 - 11 Apr 12- 18 Apr 19 - 25 Apr 26 - May 1


Pending sales by county (Bay Area)

page63

25

32

4 4

6

11

24

87

16

23

32 3

9

18

7 7


Average Daily Pending Sales

Mar 1 - 7 Mar 8 - 14 Mar 15 - 21 Mar 22 - 28 Mar 29 - Apr 4 Apr 5 - 11 Apr 12 - 18 Apr 19 - 25 Apr 26 - May 1


% chg. in pending sales from prior week (Bay Area)

page64

County/Week ending

Mar 14

Mar 21

Mar 28 Apr 4 Apr 11 Apr 18 Apr 25 May 1

Alameda 14.6% -16.2% -38.6% -34.3% 15.9% 16.3% 16.1% 0.5%

Contra Costa 1.3% -24.1% -27.2% -10.3% -18.6% 2.2% 55.3% 7.9%

Marin -38.5% -12.5% -57.1% 33.3% 37.5% 36.4% -13.3% 70.5%

Napa -38.5% -37.5% -20.0% 12.5% -33.3% 133.3% 7.1% -6.7%

San Francisco 0.0% -27.3% -21.9% -72.0% 142.9% 0.0% -23.5% 43.6%

San Mateo -5.3% -15.3% -41.0% -22.2% 28.6% 27.8% 50.0% -10.4%

Santa Clara 15.2% -23.4% -49.0% 5.2% 25.9% 4.9% 7.5% 11.6%

Solano 30.9% -33.3% -25.0% 8.3% 2.6% 47.5% -1.7% -15.5%

Sonoma 53.2% -1.4% -49.3% -19.4% 13.8% 0.0% 45.5% 2.1%

New Listings

Weekly New Listings % Chg last week CA: +18.6%

Bay Area: +21.6%SC County: +14.5%



California new listings reached highest level since SIP

page67

182

511

40

240

1,068

132

387

27176

788


Average Daily New ListingsMar 1 - 7 Mar 8 - 14 Mar 15 - 21 Mar 22 - 28 Mar 29 - Apr 4Apr 5 - 11 Apr 12 - 18 Apr 19 - 25 *Apr 26 - May 1



New listings surged in the latest week

page68

-14.2% -11.6% -12.4%-6.5% -10.8%

21.6% 22.1% 26.8%

12.5%18.6%


% Chg. in New Listings from Prior Week (Daily Average)

Mar 8 - 14 Mar 15 - 21 Mar 22 - 28 Mar 29 - Apr 4Apr 5 - 11 Apr 12 - 18 Apr 19 - 25 *Apr 26 - May 1


New listings by county (Bay Area)

page69

3538

76 5

17

38

18 18

2627

9

5 4

10

27

13 13


Average Daily New ListingsMar 1 - 7 Mar 8 - 14 Mar 15 - 21 Mar 22 - 28 Mar 29 - Apr 4 Apr 5 - 11 Apr 12 - 18 Apr 19 - 25 *Apr 26 - May 1


% chg. in new listings from prior week (Bay Area)

page70

County/Week ending Mar 14 Mar 21 Mar 28 Apr 4 Apr 11 Apr 18 Apr 25 May 1

Alameda -10.5% -47.5% -24.1% 36.4% 17.5% -11.3% -1.6% 45.1%

Contra Costa -9.9% -37.6% -7.4% 12.4% -2.6% 20.0% -8.3% 13.8%

Marin -34.7% -37.5% -45.0% 100.0% 50.0% -12.1% 34.5% 52.6%

Napa -50.0% 45.0% -27.6% -23.8% 50.0% 16.7% 17.9% 2.5%

San Francisco -29.7% -57.7% -54.5% 0.0% 240.0% -5.9% 6.3% 71.6%

San Mateo -18.3% -43.9% -23.6% 42.9% 16.7% -4.3% 3.0% -1.9%

Santa Clara -4.9% -52.9% -12.5% 54.3% -7.4% 0.0% 10.0% 14.5%

Solano -27.4% -10.0% -17.3% 22.4% -19.5% 28.8% -9.4% 16.7%

Sonoma -9.6% -38.1% -25.7% 36.5% 9.9% 10.3% -16.3% 23.1%


Forecast?

Forecasting the COVID 2020 Market –Scenarios > Single Point Forecasts

page072

NAR Forecast: Sales -13.5%Prices +1.3%


5. How are things in the trenches?


Dates

page74

• Week 1 (n=266): March 6-8• Week 2 (n=1,085): March 14-16• Week 3 (n=749): March 20-23• Week 4 (n=923): March 27-30• Week 5 (n=749): April 3-6• Week 6 (n=722): April 10-13• Week 7 (n=609): April 17-20• Week 8 (n=524): April 24-27• Week 9 (n=511): May 1-4

page75

Weekly Survey of CA Realtors


• Buyers & sellers took a time out mid-March – April• Sellers cancelling open houses and listings – but not all• Buyers postponing search, withdrawing offers, canceling

escrow – but not all of them• Job/Portfolio loss is chief reason for cancelling escrow • Buyers expecting prices to drop, sellers not so much• Share of discounted listings has not budged • Financing is the chief bottleneck in closing delays• Agents are adapting: More virtual tours, e-signing etc.


3 in 5 have had open houses canceled

page76

61%

39%

68%

32%

65%

35%

66%

34%

67%

33%

63%

37%

59%

41%

Yes No

March 20-23March 27-30April 3-6April 10-13April 17-20April 24-27May 1-4

Q: Have you had any open houses canceled due to Coronavirus?


2 in 5 members seeing buyers withdraw their offer

page77

36%

64%

42%

58%

43%

57%

44%

56%

48%52%

42%

58%

41%

59%

Yes No


Q: Have you had any buyers withdraw an offer due to Coronavirus?


Over half have seen a seller remove home from market

page78

13%

54%

33%31%

39%

30%

44%

32%

24%

46%

30%

24%

54%

26%19%

57%

27%

16%

52%

30%

18%

51%

36%

13%

Yes No Not sure

March 14-16March 20-23March 27-30April 3-6April 10-13April 17-20April 24-27May 1-4

Q: Have you seen any sellers remove their home from the market completely due to Coronavirus?


3 in 10 members reporting a transaction that fell out of escrow

page79

21%

79%

29%

71%

27%

73%

28%

72%

31%

69%

30%

70%

30%

70%

Yes No


Q: Have you had a transaction fall out of escrow due to Coronavirus?


1/3 of those who were supposed to have a transaction close, did not

page80

48%52%51% 49%

54%

46%

63%

37%

56%

44%

63%

37%

Yes No

March 27-30April 3-6April 10-13April 17-20April 24-27May 1-4

Q: Have you had any transactions close since March 15?


Have you had a transaction fall out of escrow due to Coronavirus? What happened?

• “Jumbo loan market changed......Buyers downpayment requirement went from 15% to 40% in order to qualify."• “I have had one escrow CANCELLED due to Corona Virus impacting his income. Another buyer wanted to have a $50,000 reduction in purchase price because he claimed one of his tenants died of Corona Virus, another tenant lost his job. His wife also lost her job also. My seller rejected his reduction in price and the buyer CANCELLED the escrow a day before it was to close. THEY WERE USING THE CAR CVA Corona Virus Addendum FORM! Thank you COVID-19 I lost $35,000 in commission!”• “We had to make an offer on an occupied property. After getting in contract, buyer finally saw the property and didn't like it at all and cancelled."

page81


Additional comments?

• “Together we will get through this. The public protesting needs to stop. Politicians need to listen to the experts, scientists and public health organizations. The cure and vaccine will come but in due time. Patience is key. • “CAR is doing a fabulous job, in my humble view, responding to the ever-changing circumstances of this Virus Thing . . . I feel represented and supported . . . And thereby, fortunate . . .”• “Thanks for the Webinar for Agents to have resources tools. Since we are independent contractors too and we too are worried. Information is key to help us navigate the public through these times. Thank you. Stay safe and Healthy."• “Ya'll are doing a great job of being ON this with resources. I am one of those "doesn't really bother me, I'll be fine" mindsets. But trying to be respectful of OTHER'S reality of fear."

page82


7. What will the recovery look like?


Steve Murray, RealTrends

I would love to think that this will be the first “V” housing recovery in the last 40 years (which didn’t have funny money mortgages involved). History indicates otherwise. Recessionary shocks to the entire economy typically unnerve consumers, especially when it comes to housing. The history of the last 40 years instructs us that recoveries are often drawn out over years, not months.


8. What should I be doing now to prepare?


Plan to thrive after the crisis at the same time you are dealing

with the immediate challenges.

page87

page88

Post-COVID Real Estate


• Accelerate transition to digital everything• More agents working from home – smaller offices• More virtual meetings and digital content for consumers –

increase opportunities to educate clients and build rapport • Increase virtual presence with 3-D virtual tours• Paperless transaction becomes a reality

page89

Post-COVID Consumers


• Will save more/spend less• Will NEST more – need different spaces to WFH• Will Social Distance/Desire Safety/Value Open Space • Opportunity to reset relationships with consumers


Who Will the Winners Be? 1. The tech-enabled agent

2. The relationship – centered agent

3. Residential real estate

4. Transition commercial and retail spaces into affordable

residential villages.

page90


Thank YouThis presentation can be found on

www.car.org/marketdataSpeeches & Presentations

[email protected]

Date post:	06-Feb-2022
Category:	Documents
Upload:	others
View:	2 times
Download:	0 times

2020 Market Update: Assessing the COVID Marketplace

Documents